Maxwell Company uses a standard cost accounting system and applies production overhead to products on the basis of machine hours. The following information is available for the year just ended:Standard variable-overhead rate per hour: $2.50Standard fixed-overhead rate per hour: $4.00Planned activity during the period: 20,000 machine hoursActual production: 10,700 finished unitsMachine-hour standard: Two completed units per machine hourActual variable overhead: $55,440Actual total overhead: $155,900Actual machine hours worked: 23,100 Required: 1.Calculate the budgeted fixed overhead for the year. 2.Compute the variable-overhead spending variance. 3.Calculate the company’s fixed-overhead volume variance.
Maxwell Company uses a
Required:
1.Calculate the budgeted fixed overhead for the year.
2.Compute the variable-overhead spending variance.
3.Calculate the company’s fixed-overhead volume variance.
4.Did Maxwell spend more or less than anticipated for fixed overhead? How much?
5.Was variable overhead underapplied or overapplied during the year? By how much?
6.On the basis of the data presented, does it appear that Maxwell suffered a lengthy strike during the year by its production workers? Briefly explain"
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
